BUSH'S BUDDY ECONOMY.(Brief Article)

When George W. Bush took office, his Administration loudly touted its corporate credentials. In place of Clinton's policy wonks, the Bush economic team featured real businessmen, who knew how the world worked, and who appreciated, in a visceral and practical way, the value of free markets. Bush had more former C.E.O.s in his Cabinet than any previous President. His Vice-President was a former C.E.O., and Bush himself had run an oil company. "No president, administration, and Cabinet has been as marinated in capitalism," observed USA Today, which also praised the Administration's "deep management pool" and its "all-star boardroom."

Now, though, the consensus seems to be that Bush's boardroom is filled with benchwarmers, not all-stars. The Administration has been lambasted, from the left and the right, for its lack of political dexterity, as evidenced by the performance it gave a few weeks ago at the Economic Forum, in Waco, Texas. But the more substantive criticism is that it has a scattershot approach to economic policy, with little regard for the nature of markets. The White House pushed an energy plan that was not much more than a sop to big oil. It imposed high tariffs on foreign steel, which, though a boon to the domestic steel industry, hurt domestic steel users, alienated our trading partners, and compromised America's role as the leading advocate of free trade. Then, last week, under political pressure, it scaled back some of the steel tariffs. Bush signed a fat farm bill full of puzzling subsidies to agribusiness. And he was slow to respond to the crisis of confidence on Wall Street, offering lectures on individual responsibility instead of pressing for systemic reform. Practically the only thing that the Administration has been principled about is its tax cut.

The conventional explanation for such inconsistency and incoherence is that Karl Rove, the President's chief political adviser, has been overruling the ex-C.E.O.s--that political expediency has trumped ideology. Protectionism may be bad for the country as a whole, but it's good for potential Bush voters in the steel states; farm subsidies may hurt consumers, but they help representatives from the farm states. Yet, while there's no doubt that Rove wields great power, there are reasons to doubt whether the Bush Administration was ever really committed to a pro-market--as opposed to a pro-business--agenda.

Almost none of the C.E.O.s on the Bush team headed competitive, entrepreneurial businesses. The majority of them, in fact, made their bones in protected or regulated industries, where success depends on personal lobbying and political maneuvering. Bush himself, of course, built a small fortune on family connections, finagling a spot on the board of Harken Energy, and securing a publicly financed stadium for the Texas Rangers. ...